Do seasoned Hard Money Investors recommend the use of “Hard Money” for a new investor?
What type of deals are you using hard money for?
What amount of ROI are you seeing?
Details for the group please.
I have never used hard money, but I have friends who have used hard money. I don't think that a new investor should consider it, but it also depends upon the strategy. From what I have seen, the most common strategy that employs hard money lending is fix and flip. The problem, in my opinion, is that right now, many markets have too much inventory. So if you get a hard money loan, and your exit strategy is to sell, then you need the reserve capital to hold a vacant property for 100 days, in my market. To employ a back up exit strategy to refinance and rent, mid FICOs should be better than 700, you should be able to go full doc and have 6 months PITI. ROI depends on the deal.